November 11, 2015

A PROPHET IS NOT WITHOUT HONOR EXCEPT IN HIS OWN TIME:

Robots Won't Own You. You'll Own the Robot. (Noah Smith, 11/11/15, Bloomberg View)

Humans, like machines, cost resources to create and maintain. Raising kids is expensive -- food, shelter, medicine, education and much more. Adults consume even more. If wages ever fall below the level needed to maintain human existence, then either humans will survive via redistribution, or they won't survive at all. 

Would income redistribution be the answer? With a society of robot-provided abundance, wouldn't it be easy to simply provide all the low-earning masses with a basic income? Unfortunately, redistribution depends on politics, and in an age of robots, the masses may have very little power to compel the wealthy to give up even a small sliver of their wealth. "Once the military became robotic," Weinersmith writes, "revolution became impossible." It's an extreme scenario, but not out of the realm of possibility. 

Since there is no guarantee that humans would have any power in a robot future, income redistribution is a shaky solution. A better idea might be redistribution of corporate ownership itself. If everyone in the country owned index funds, it would provide people with a second income -- an income from capital, not labor. That would act as an insurance policy against the economy-wide replacement of labor with capital. 

Interestingly, the biggest proponent of this type of policy was former President George W. Bush. Although Bush's idea of an "ownership society" didn't get much traction, it might one day become the only way to maintain any semblance of equality. His idea of replacing Social Security with individual investment accounts was a form of mass stock ownership. Although that plan would have dramatically increased risk for American retirees, we may someday want to have the government create individual stock accounts in addition to Social Security.

The point of starting HSAs, O'Neill Accounts and the like at birth--and forcing the money into index funds--is that we'll all own the corporations.

Posted by at November 11, 2015 4:46 PM

  

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